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Virtual Data Rooms & CO: Extensive offer, but company goals is what counts

ottobre2018

Virtual Data Rooms & CO: Extensive offer, but company goals is what counts

Can a large business, an institution, a legal firm or research group avoid using tools such as Virtual Data Rooms (VDRs) or Board Portals (BP)? Probably not: whether for extraordinary circumstances (i.e. evaluation of an acquisition or an IPO), or on a daily basis (i.e. disputes, business partnerships or research activities), whoever needs a reliable virtual workspace with protected data accessible from different geographical locations, from different devices, through which third parties can access with authorized and restricted profiles depending on their operational role, the use of a VDR is crucial. Furthermore, in institutions or companies led by a board of directors that determines key steps in the life of the organization, meetings need to be prepared by providing insights, confidential data and documents, but also they need to be held with board members being able to view the points to be discussed simultaneously and in real time, perhaps by modifying the actual measures taken. There is no doubt that these tools have a dominant role in the activity of large and medium-sized organizations, so much so that some some researches estimate for the next few years an average double-digit growth for the VDR industry.

Ad hoc solutions or Content Collaboration Platforms: are we at a crossroad?

According to a research carried out by the research and advisory firm Gartner entitled "Implementing Virtual Data Rooms and Board Portals in Flexible and Cost-Effective Ways", the crossroad at which companies and institutions find themselves at together with their application leaders, is whether to choose an ad hoc solution strictly related to the contingent need of a working tool, or opt for alternative tools. In terms of safety, costs and future development, when is it preferable to focus on highly specialized products or a new approach? The crossroad is between Virtual Data Rooms and Board Portals and a strategy based on Content Collaboration Platforms (CCP), that is, content sharing platforms to transform the whole activity and the way the organization works. The products currently on the market, however, can in many cases already meet both requirements thanks to CCP already programmed to enter in VDR and in BP mode.

Security: the first condition to choose from

The belief that ad hoc solutions are less vulnerable to violations because they are not integrated, and the analysis of all the contexts in which content sharing is functional to the business activity, are two of the factors that can orient towards one or the other technological tools. The Content Collaboration Platforms’ market, according to Gartner, offers alternatives to the hyper-specialized approach, providing answers to the need for secure content distribution, compliance, secure data protection, and the need for mobile use, by opening, on one hand, the opportunity for collaborators and work teams to define new forms of productivity and the ability to share contents, and on the other, constitute a basic support for Virtual Data Rooms and Board Portals.

A comparison based on costs

Therefore, the first step to take, according to Monica Basso, an analyst at Gartner, is to develop a plan for content sharing services based on the needs and activities of the organization: if the absolute priority is the need for an environment for separate and inaccessible data, then better to focus on VDRs and BP and face higher costs for ad hoc solutions. If, instead, there is no need for this stringent element but there is instead a wider request for data management and archiving, then it is preferable to focus on a CCP that guarantees, however, cyber security and scalability, allowing to cover also situations related to Virtual Data Rooms and Work spaces dedicated to administrators or managers with key roles in the organization. In this second case, however, there may be the need to customize the CCP, so only an analysis of the costs required by this adjustment can make it clear if it is better to switch to specialized products. The cost is an important discriminating factor that must take into account the different approach, according to Gartner: the CCP have price models based on the number of users and the duration of the contract and allow access to documents without restrictions and limitations in the number of projects or work environments created. VDRs, instead, base their price mostly on the volumes of managed data and the duration of the contract, rather than the number of users, allowing to define the level of protection of data and accesses according to diverse operational needs.

Secure advanced digital platforms: a proper alternative

The market, however, already offers platforms that are natively structured to combine the various needs: from maximum sharing to maximum segregation of information. There are, in a small but recognized and well-defined niche market, highly professional platforms that are already created to be configured according to different work needs. In these cases, the provider will tighten the platform’s security measures, activating all the protection features on uploaded documents and on user access in order to monitor the platform activity also by third parties involved. These platforms, usually tailor-made and developed in-house, represent a valid alternative in choosing which advanced digital tool to adopt.

Secure advanced digital platforms: a customized service, but in a few simple moves

For certain typical situations such as Board of Directors, listings on the stock exchange or M&A transactions, the necessary features are configured (Calendar, full-text search, OCR, advanced Q&A, etc.), the security procedures and protocols must be activated both on documents (i.e. application of a dynamic watermark containing IP, username and time of viewing, etc.), and on user accesses that, for these types of operations are granularly profiled and verified through Strong Authentication before logging into the platform (unlike the SSO, which is preferable to access the platform when working on a collaborative workspace). Moreover the assignment of a "role" allows to assign different "rights" to each user (to only view files on-screen, to edit files directly within the platform, to download a copy of the file and work on it offline, etc.) All users are monitored during their entire stay on the platform, through log reporting and analysis. The service so will become compliant with the current legislation as well as for IT audits or forensic analysis. Service customization is always necessary in these cases, as reported by Gartner’s study, and sometimes the provider will not apply any additional costs, as well as for the option of having documentation available in different languages and dedicated customer support 24/7/365. Staying on the cost issue, certainly this kind of platform has different costs compared to a more common CCP, but in this case, providers generally establish prices based on space and contract period, rather than the number of users. Often, between these type of providers and their clients it becomes more convenient to sign a long-term contract. For clients this means they can have a single technological provider for all digital services that may be required during their company’s lifespan, at convenient fees.